State v. Vienup

• Citation: 147 S.W.2d 627,347 Mo. 382
• Decision Date: 14 February 1941
• Docket Number: 37178
• Parties: The State v. Chester Vienup and National Surety Corporation, a Corporation, Appellants
• Court: United States State Supreme Court of Missouri

147 S.W.2d 627

347 Mo. 382

The State v. Chester Vienup and National Surety Corporation, a Corporation, Appellants

No. 37178

Supreme Court of Missouri

February 14, 1941

Appeal from Warren Circuit Court; Hon. Frank Hollingsworth Judge.

Reversed.

George C. Dyer, D. A. Murphy and Harding, Murphy & Tucker for appellants.

(1) The trial court erred in construing the bond as a forfeiture bond rather than a bond of indemnity because: (a) The bond is conditioned not only that the principal will not violate any of the provisions of the Liquor Control Act of Missouri, but additionally, that he will pay all taxes, inspection and license fees, together with all fines, penalties and forfeitures which may be adjudged against him under the provisions of the Liquor Control Act. Laws 1933-34, Ex Sess., sec. 19, p. 77; State v. Wipke, 133 S.W.2d 354; State v. Ruebling, 133 S.W.2d 360; O'Kane v. Lederer, 4 F.2d 418; United States v. Wandmaker, 292 F. 24; United States v. United States Fid. & Guar. Co., 1 F.2d 355; United States v. Zerbey, 271 U.S. 332, 46 S.Ct. 532; United States Fid. & Guar. Co. v. United States, 12 F.2d 1021; United States v. Randall, 58 F.2d 193; United States v. Warnell, 67 F.2d 831; United States v Kern, 8 F.Supp. 296; United States v. Hartford Accident & Indemnity Co., 15 F.Supp. 791; State v. Estabrook, 29 Kan. 739; State v. Larson, 83 Minn. 124, 86 N.W. 3; St. Cloud v. Willenbring, 261 N.W. 585; Clark v. Barnard, 108 U.S. 436; State v. Vending Machine Corp., 174 Okla. 603, 51 P.2d 724; Illinois Surety Co. v. United States, 229 F. 527; United States v. Engelberg, 2 F.2d 720; Quintard v. Coreoran, 50 Conn. 34; Commonwealth v. Moeschlin, 170 A. 119; City of Paducah v. Jones, 104 S.W. 971; City of Albany v. Cassel, 76 S.E. 105. (b) To construe the bond as a forfeiture bond would be inconsistent with the obvious intent of the Legislature, evidenced by the provisions of the Liquor Control Act: Concerning the "suspension" and "revocation" of licenses: Laws 1933-34, Ex. Sess., p. 82; as amended Laws, 1937, secs. 13, 26; Bouvier's Law Dictionary (Baldwin's Century Ed.), pp. 1160, 1070. (2) The full penalty of the bond may not be recovered as liquidated damages for the reason that the bond is conditioned upon the performance of several duties of varying importance, the damages for breach of some being capable of ascertainment, and for breach of others being incapable of ascertainment. Gower v. Saltmarsh, 11 Mo. 271; Hammer v. Breidenbach, 31 Mo. 49; Basye v. Ambrose, 28 Mo. 39; Morse v. Rathburn, 42 Mo. 594; Sylvester-Watts-Smyth Realty Co. v. American Surety Co., 292 Mo. 423, 238 S.W. 494; Jennings v. First Natl. Bank of K. C., 30 S.W.2d 1049; State v. Hackbarth, 279 N.W. 687; City of Summit v. Morris County Traction Co., 85 N. J. L. 193, 88 A. 1048; City of Brunswick v. Aetna Indemnity Co., 4 Ga.App. 722, 62 S.W. 475; State v. Estabrook, 29 Kan. 739.

Roy McKittrick, Attorney General, for respondent;

J. F. Allebach of counsel.

(1) Where bond is given to a sovereign as a condition of license or other privilege and conditioned upon compliance with the law, the full penalty may be recovered for a breach thereof without showing actual damages because of the impossibility of showing or proving actual damages. State v. Wipke, 133 S.W.2d 354; Secs. 13a, 19, Laws 1933-34, Ex. Sess., pp. 82, 83; United States v. Montell, 26 F. 798; Clark v. Barnard, 109 U.S. 436; United States v. Engelberg, 2 F.2d 720; Quintard v. Corcoran, 50 Conn. 34; Commonwealth v. Moeschlin, 170 A. 119; City of Paducah v. Jones, 104 S.W. 971; City of Albany v. Cassel, 76 S.E. 105; 103 A. L. R., 405; United States v. Wandmaker, 292 F. 24; United States v. Zerbey, 271 U.S. 332; State v. Larson, 83 Minn. 124, 86 N.W. 3; St. Cloud v. Willenbring, 261 N.W. 585; State v. Estabrook, 29 Kan. 739. (2) The provisions of Section 19 requiring faithful performance are separate and apart from the indemnity provisions and give the bond a dual character. The breach of faithful performance provisions calls for a full forfeiture, while a breach of indemnity provisions calls for only the amount of actual loss or damage. Sec. 19, Laws 1933-34, Ex. Sess., p. 82; Eagle Indemnity Co. v. United States, 22 F.2d 388; Runnels v. Lasswell, 272 S.W. 1032; United States v. Engelberg, 2 F.2d 720; Lyman v. Perlmutter, 166 N.Y. 410, 60 N.E. 21; Lyman v. Fidelity Deposit Co., 57 N.Y.S. 372; Lyman v. Schenck, 55 N.Y.S. 770. (3) The legislative intent is clear that entire penal sum of the statutory liquor bonds of liquor dealers is to be forfeited to the State in the event of the faithful performance provisions of the Liquor Control Act are violated. Secs. 6510, 6527, 6537, R. S. 1919; State v. Larson, 86 N.W. 3; State v. Hackbarth, 279 N.W. 687; State ex rel. Hayes v. Hailer, 199 Mo.App. 470, 203 S.W. 664; 11 C. J. S., 472; Moody v. Megee, 31 F.2d 117; State ex rel. v. Green, 124 Mo.App. 80; Scott v. Mo. Pac. Ry. Co., 38 Mo.App. 523; Young v. Young, 52 N.E. 776; American Surety Co. v. Thorn-Holliwell Cement Co., 57 P. 237; People v. Cotteral, 115 Mich. 43; School District v. Livers, 147 Mo. 580; St. Louis v. Von Phul, 133 Mo. 561; Devers v. Howard, 144 Mo. 671; Squires v. Michigan Bonding Co., 138 N.W. 1062; Sec. 2854, R. S. 1929; Swanson v. Ball, 291 N.W. 577. (4) If the bond involved in this case is not the correct type of bond as required by the statute, then it is good as a commonlaw bond. Burton Machinery Co. v. Ruth, 194 S.W. 526, 196 Mo.App. 459; Nations v. Beard, 267 S.W. 19, 216 Mo.App. 33; State ex rel. Hubbard & Moffit Comm. Co. v. Cochrane, 175 S.W. 599, 264 Mo. 593; 11 C. J. S. 412; Southern Surety Co. v. Nalle & Co., 242 S.W. 203; Love v. McCoy, 94 S.E. 955; State ex rel. Cantwell v. Stark, 75 Mo. 566. (5) The Liquor Control Act is constitutional.

OPINION

Hays, J.

The State of Missouri brought this action against Chester Vienup, a dealer licensed to sell intoxicating liquors in the original package, and the National Surety Corporation, surety on Vienup's bond, alleging breach thereof in the particular hereinafter mentioned. Judgment was for the plaintiff and the defendants have appealed. The case was submitted to the circuit court sitting without a jury. The material portions of the case and of the record made below may be summarized as follows: On December 31, 1936, Vienup applied to the Supervisor of Liquor Control for a license to sell intoxicating liquor in the original package at an establishment known as the White Way Camp in Warren County. A license was issued to him. As a condition precedent to its issuance the two defendants executed and filed with the Department of Liquor Control a bond in the penal sum of $ 2000, which was in the form duly approved by the Supervisor and is the instrument here sued upon. This bond was given in compliance with the provisions of Section 19 of the Liquor Control Act of 1933 and acts amendatory thereto (Laws of Mo., Extra-Session 1933-34, p. 77, Mo. Stat. Ann., sec. 4525g-21, p. 4689), and was conditioned as follows:

"The condition of this obligation is such, that, if the said principal does not violate any of the provisions of Committee Substitute for Senate Bills Nos. 6, 21, 22, 23, 24 and 25, passed by the 57th General Assembly in Extra Session, and any acts amendatory thereto, or any rule or regulation of the Supervisor of Liquor Control; and if said principal shall at all times keep an orderly house and does not sell, give away, or otherwise dispose of, or suffer the same to be done about his premises, any intoxicating liquor in any quantity to any minor; and if said principal shall pay all taxes, inspection and license fees provided for by law, together with all fines, penalties and forfeitures which may be adjudged against the principal and under the Liquor Control Act and amendatory acts thereto; and if said principal shall faithfully perform all duties imposed upon him by law, then this obligation shall be null and void; otherwise to remain in full force and effect; provided, the enumeration of the foregoing specific provisions shall not be construed as limiting or affecting in any way the foregoing general provisions; provided, further, that a breach of any of the conditions of said bond, whether general or special, shall work a forfeiture of said bond."

While this license and bond were in full force and effect Vienup, in violation of the provisions of the Liquor Control Act of 1933, sold one-half pint of whiskey on Sunday to an inspector of the department. For this violation he was cited to appear before the Supervisor, given a hearing, and his license suspended for thirty days.

In the trial court the State, alleging this sale as a breach of the bond, sought and was given judgment for the entire penal sum of $ 2000. There was no evidence whatsoever of any actual damage suffered by plaintiff as a result of such breach, but the trial court held that the bond sued upon was a forfeiture bond as distinguished from one of indemnity only; that evidence of damage resulting from the breach was unnecessary, and that on the mere proof of breach the State was entitled to collect the entire penal sum. This ruling is now assigned as error.

The question for our determination therefore is this: Is the bond sued upon one of forfeiture or one of indemnity? The answer to this question must turn on the construction to be given the statute under which the giving of the bond is required and which prescribes its terms; for, under the well settled rule in this State, any required provisions of the condition of the bond found in the statute but omitted from the instrument itself must be read into it, and, conversely terms which are found in the condition of the bond but not in the statute are to be disregarded. [State v. Wipke, 345 Mo. 283, 133...